Rhode Island politicians continue to prioritize individual wealth over community improvement | Opinion

Scott M. Dowling, of Providence, works in nonprofit management and human resources.

Brown University recently announced a plan to invest $150 million in Lifespan over the next few years. Last year, the Providence City Council approved payment-in-lieu-of-taxes (PILOT) agreements with four private higher-education institutions: Brown University, Johnson & Wales University, Providence College and the Rhode Island School of Design. These agreements could generate $223 million for the city over the next two decades, yet they come with credits that allow universities to reduce their financial contribution through development projects.

The combined endowments of these schools currently is about $7.6 billion, bringing into stark contrast the total value of the PILOT program contributions at less than 3% of the total value of their collective endowments.

In addition to the substantial funds available to them through their invested endowments, these universities are also major property owners in Providence, with combined property holdings estimated to be worth over $2 billion. If these properties and endowments were taxed at Providence’s commercial tax rate of approximately 3.85%, the annual property taxes alone would amount to around $77 million annually, and $1.54 billion over the life of the PILOT agreement.

However, these institutions contribute far less, with tens of millions of dollars in annual tax savings while pouring twice as much into fellow corporations as they do into the local community, further highlighting the financial advantages these universities and their partners enjoy at the expense of the local community’s needs.

The potential revenue from fully taxing the endowments and properties of these institutions would be substantial. Annually, the city and state could collect approximately $77 million from property taxes alone. Combined with the additional $15.6 million annually lost due to the recent Citizens Bank tax break, this would amount to nearly $93 million in potential revenue each year. This additional revenue could significantly enhance public services in Rhode Island.

We spend approximately $17,000 per student annually; the additional revenue could support the education of around 5,470 students or add an additional $3,800 per student to the Providence Public School District. This could improve education quality, reduce classroom sizes, and provide better resources and facilities for students and teachers.

Expanding health care services and coverage could also be achieved with this revenue. Recent updates to the state budget have included significant increases in Medicaid funding. The fiscal year 2023 budget includes $32.7 million for Medicaid reimbursement rate increases, with total Medicaid spending reaching $3.95 billion. An additional $93 million per year could drastically expand the state's commitment to improving public health services, addressing critical needs in the health care system, and increasing access to essential health services for underserved communities.

In addition to education and health care, we are all acutely aware of the housing and infrastructure crises in Rhode Island, both of which could be addressed by redirecting funds to support affordable housing projects and improve infrastructure. This would help alleviate homelessness, provide safe and affordable housing for low-income families; improve overall living conditions; enhance public safety, reduce traffic congestion and carbon emissions; and support economic growth in the hardest hit communities, such as East Providence.

Rhode Island politicians chomping at the bit to provide corporate tax breaks or not taking the initiative to pass legislation to access more funding for their local communities show who their true constituents are.

Our elected officials’ focus on enhancing the power and influence of wealthy entities detracts from the state’s ability to address critical issues such as education, health care, infrastructure and affordable housing.

Moreover, these decisions reflect a broader trend in Rhode Island government of policies shaped by the interests of a select few rather than the broader community. The emphasis on corporate welfare over public welfare raises significant concerns about the efficacy, reliability and corruptibility of our politicians.

Only by prioritizing community welfare over corporate welfare can the state ensure a prosperous and equitable future for all its residents.